But there's a better, more efficient, way to make sure
underprivileged kids can go to college: Have venture capitalists
invest in promising students, much as they finance other "new
ventures with no collateral."

The students would graduate with no debt, only pay back their
investors based on their post-graduate earnings, and the market,
free from distorting subsidies, "would create more informed
demand for the schools, exerting pressure on them to contain
costs and improve quality." How would this work? Here's an
excerpt:

The best way to fix this inefficiency is to
address the root of the problem: Most bright students do not have
any collateral and cannot easily pledge their future income....
Investors could finance students' education with equity rather
than debt. In exchange for their capital, the investors would
receive a fraction of a student's future income — or, even
better, a fraction of the increase in her income that derives
from college attendance. ...

This is not a modern form of indentured servitude, but a
voluntary form of taxation, one that would make only the
beneficiaries of a college education — not all taxpayers — pay
for the costs of it.